By Xie Yu

HONG KONG and BENGALURU (Reuters) -Embattled Chinese property developer China Vanke said on Monday it had completed the sale of a plot of land in Shenzhen for 2.24 billion yuan ($309.23 million), more than 27% below the price it paid for the block nearly seven years ago.

The company is working to raise funds after saying last month it is facing short-term liquidity pressure, one of many companies to have been caught up in a broad-based cash crunch in China’s crisis-hit real estate sector.

Vanke’s largest shareholder, state-owned Shenzhen Metro, and Shenzhen Baishuo Yinghai Investment jointly bought the plot at the reserve price, according to an online filing uploaded to a trading center in Shenzhen on Monday.

The bid was the only one for the asset, the same filing, made after the mainland stock market was closed, showed.

Vanke, in a statement to Reuters, said the deal reflects its largest shareholder is “supporting the company with market-based, legitimate measures and real money”.

The deal will help the firm free up capital from non-core business assets. Upon completion, 70% of construction floor area would be kept by the owners and 30% would be allowed for sale.

Vanke bought the same 19,000 square-metre block in late 2017 for 3.1 billion yuan, according to previous documents.

The company has said it aims to boost cash flow this year with bank financing and more asset disposals worth more than 30 billion yuan.

Last week, Vanke said it had received a 20 billion yuan syndicated loan facility from a group of banks led by state-owned Industrial and Commercial Bank of China and would push forward other financing to boost its liquidity.

Fitch Ratings on Friday downgraded its long-term foreign- and local-currency issuer default ratings to ‘BB-‘ from ‘BB+’ and set the outlook as negative, citing a mainly weaker-than-expected sales performance in the year to date.

($1 = 7.2449 Chinese yuan renminbi)

(Reporting by Xie Yu in Hong Kong and Shivangi Lahiri in Bengaluru; Editing by Jan Harvey and Sriraj Kalluvila)

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